Have speed 20 (this is a penalty), Low-light vision,
Which is only useful if they choose a class that routinely uses Illusion magic.
+2 on saves against an entire school of magic, Weapon Familiarity (not as good as a full Weapon Proficiency, but it's something), bonus to attack FOUR very common foes (kobolds, goblins, hobgoblins and bugbears, just to stay core), very good AC bonus against an entire type of creatures,
Weapon familarity is like the bonus DC to Illusion, and the others are reliant on DM fiat since being targeted by illusion spells or fighting those enemies may happen often, once in a while, or never.
+2 on a very useful skill (Listen), +2 on a rarely used skill (Alchemy), one spell-like ability and any average gnome also gets three more spell-like abilities.
Alchemy may as well not be there, the cantrips are nifty little gimmicks at low level, and Listen is a nice bonus that may or may not be useful depending on the characters specialization & class as the game progresses.
Yeah, the gnome also wins by a landslide.
I cannot agree with that assessment. Ability score bonuses are much more significant than the minor bonuses given to Gnomes due to the fact that a player can specifically design and maximize the powers of ability score bonuses in a much more efficient and long term fashion than specific, DM reliant abilities.
Honestly, if Hobgoblins were LA+0, what intelligent, maximizing player would
not make them their first choice for a spellcaster, Ranger, Rogue, Barbarian, or any number of other similar character archetypes? The bonuses ability scores give are much more pertinent and have a significant impact on the character throughout the entire game.
You would be hard pressed to find a Gnome that consistently makes use of all of his myriad minor abilities on a regular or even intermittent basis, due to the differences in character specialization and environment, whereas you would be hard pressed to find a Hobgoblin that did not consistently gain signifciant benefit from his ability bonuses.